U.S. equity markets suffered a sharp reversal on Thursday, as early gains evaporated and major indexes ended the day in the red. The SPY (representing the S&P 500) shed about 1.6 % after rallying nearly 1.9 % earlier in the day. The tech‑heavy QQQ (tracking the Nasdaq Composite) dropped approximately 2.2 % while the Dow Jones Industrial Average slid roughly 0.8 %.
The turn downward came despite a strong earnings report from NVDA (Nvidia), a bellwether for the AI‑driven market rally. Though Nvidia’s revenue beat expectations and its outlook was upbeat, the stock ended the day down more than 3 %, dragging other semiconductor and AI infrastructure plays lower. Markets interpreted the weakness as a sign that even strong results might not dispel worries about lofty valuations in the AI sector.
Contributing to the market’s jitters was a delayed U.S. jobs report that showed 119,000 new hires but also a modest rise in the unemployment rate — stirring confusion over whether the Federal Reserve will cut interest rates in December. The combination of valuation concerns, mounting tech risks and uncertain policy outlooks triggered a flight to safety and heightened volatility, seen in a jump in the VIX volatility index.
Analysts say the reversal underscores the narrowness of the rally — heavily reliant on a handful of tech giants — and suggest investors should brace for more turbulence ahead as questions persist over AI payoff timelines and broader economic momentum.
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